Gran Colombia Completes Merger With Medoro To Create Colombia's Premier Gold Company

June 13, 2011

TORONTO, June 13, 2011 /CNW/ - Gran Colombia Gold Corp. (TSX: GCM, GCM.WT, GCM.WT.A) announced today the completion of its merger with Medoro Resources Ltd. (TSX: MRS, MRS.WT).  The combined company continues under the name "Gran Colombia Gold Corp."

"This is an important milestone for Gran Colombia and its shareholders," said Serafino Iacono, Executive Co-Chairman of the combined company.  "The merger creates Colombia's premier gold company with an attractive portfolio of gold and silver assets, and numerous growth opportunities through the combined inventory of Gran Colombia and Medoro's potential exploration and development projects."

Gran Colombia's new senior management team is composed of officers of Gran Colombia and Medoro, with Maria Consuelo Araujo continuing to serve as Chief Executive Officer and Serafino Iacono and Miguel de la Campa continuing to serve as Executive Co-Chairmen.   Donald East will serve as Chief Operating Officer, Michael Davies will continue to serve as Chief Financial Officer, José Oro will serve as Vice-President, Production and Corporate Development, Vicente Medoza will service as Vice-President, Exploration, Carlos Pinglo will serve as Vice-President, Finance and Peter Volk will continue to serve as General Counsel and Secretary.

The directors of Gran Colombia are now Serafino Iacono, Miguel de la Campa, Maria Consuelo Araujo, Ronald Pantin, José Francisco Arata, Richard Lozano, Jorge Neher, Stephen Wilkinson, Robert Hines, Robert Doyle, J. Randall Martin, Hernan Martinez, Courtney Neeb, Jaime P. Branger, Robert Metcalfe and Augusto Lopez.

The merger was effected by way of a statutory plan of arrangement under the Business Corporations Act (Yukon), pursuant to which a wholly-owned subsidiary of Gran Colombia amalgamated with Medoro.  Under the plan of arrangement, Medoro shareholders received 1.20 common shares in the capital of Gran Colombia plus 0.50 of a Gran Colombia common share purchase warrant for each Medoro common share held.  Medoro warrantholders and optionholders had their securities exchanged for Gran Colombia options and warrants on an equivalent basis and upon exercise thereof, and payment of the applicable exercise price, will be entitled to receive Gran Colombia common shares and Gran Colombia common share purchase warrants.

The plan of arrangement was approved by Medoro securityholders at a meeting held on June 7, 2011.  Gran Colombia shareholders approved the issuance of the Gran Colombia common shares in connection with the arrangement at a meeting also held on June 7, 2011.  The Supreme Court of Yukon granted a final order approving the arrangement earlier today and the merger was completed effective as of Friday June 10, 2011.

After giving effect to the arrangement, Gran Colombia has 389,686,629 common shares, 194,438,146 listed warrants and 27,744,591 options (excluding compensation options) issued and outstanding, of which Medoro securityholders are entitled to 172,886,495 common shares and 72,035,656 warrants as consideration.  Further details with respect to Gran Colombia's share capitalization are set out below.

Gran Colombia Capital Structure (Post-Arrangement)1:

The additional Gran Colombia common shares will be listed on the Toronto Stock Exchange ("TSX") under ticker symbol "GCM" and the Medoro common shares are expected to be delisted from the TSX within two to three days after receipt by the TSX of all required documentation.  Gran Colombia will now also have two sets of public warrants trading under the ticker symbols "GCM.WT" and "GCM.WT.A", respectively.

The following table describes and summarizes the fully diluted share capital of Gran Colombia following the completion of the arrangement:

  Number of Gran Colombia
Common Shares
Common Shares (TSX: GCM) 389,686,629
Reserved for issuance on exercise of Gran Colombia Warrants expiring August 24, 2015 (TSX: GCM.WT) 157,973,149
Reserved for issuance on exercise of Gran Colombia Warrants expiring November 3, 2011 (TSX: GCM.WT.A) 36,464,997
Reserved for issuance on exercise of Gran Colombia options 10,562,500
Reserved for issuance on exercise of First Gran Colombia Private Placement Compensation Options 1,350,000
Reserved for issuance on exercise of Second Gran Colombia Private Placement Compensation Options 15,468,750
Reserved for issuance on exercise of Exchanged Gran Colombia Options 17,182,091
Reserved for issuance on exercise of Exchanged Gran Colombia Warrants2 8,506,268
Reserved for issuance on exercise of Exchanged Special Gran Colombia Warrants 3,095,113
Total (Fully Diluted) 640,289,497

Notes:
1   For additional details with respect to the exercise prices of the above-noted warrants and options, please see the joint information circular dated May 6, 2011 (the "Circular").  Capitalized terms not defined herein have the meaning ascribed to them in the Circular.
2 The Medoro November 2009 Warrants (formerly "MRS.WT") are now Gran Colombia Warrants ("GCM.WT.A").

About Gran Colombia Gold Corp.

Gran Colombia is a Canadian-based gold and silver exploration, development and production company with its primary focus in Colombia.  Gran Colombia is currently the largest underground gold and silver producer in Colombia with six underground mines in operation.  In addition, Gran Colombia is also developing a large-scale, open-pit gold and silver mine at Marmato.  The Company is carrying out significant exploration in and around its existing operations.  The Company also has a highly-prospective land position in Colombia as well as an advanced stage property in Venezuela and earlier stage properties in Mali.

Additional information on Gran Colombia can be found on its website at grancolombiagold.comand by reviewing its profile on SEDAR at www.sedar.com.

Cautionary Statement on Forward-looking Information

This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to the future financial or operating performance of Gran Colombia and its projects. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Gran Colombia to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements contained herein are made as of the date of this press release based on current expectations and beliefs and Gran Colombia disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.

For further information:

Belinda Labatte
Investor Relations
(647) 436-2152

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